Apparently, but only apparently, calm reigns over the horizon of the markets, committed to settling the accounts pending the decisions of the Fed which next week will initiate the first of the hikes (three?) expected for 2017 In reality, once the euphoria for the post-election promises has passed, the operators are waiting to understand the developments of a confused political picture.
In the US, Donald Trump, who is busy on many fronts (relations with Russia, immigration, now even Wikileaks) is struggling to get his health care reform project digested by conservatives. And, despite the rhetoric spread with both hands, he worsens the trade balance with China and Germany. And so the Bear, hibernating since the day of the election of the new president, returns, albeit timidly, to make an appearance on Wall Street, down for two days in a row: it hasn't happened for more than a month.
Europe is also cautious, awaiting Mario Draghi's words after tomorrow's ECB directorate. In reality, the central bank's room for maneuver is very limited: in five days, the Netherlands could elect an anti-European prime minister, an ugly prologue to the appointment with the French vote which continues to condition the fate of the euro. Looking ahead, in short, the situation is far from flat.
Paradoxically, Italy, which has always been accustomed to moving in an emergency, could benefit from it: after the success of the Unicredit increase (even more sensational if we consider the difficulties of Deutsche Bank) a new inflation-indexed BTP has arrived , launched successfully despite the turmoil affecting European sovereign debt. And from corporate Italy, see Ferrari and Prysmian, there are comforting signals. And so comes the most unexpected promotion. “Italy is doing the right things” said Wolfgang Schaeuble yesterday, who has accustomed us to many other broadsides, especially on the eve of the ECB summits.
TOKYO DOWN FOR FOUR DAYS. BUT NINTENDO SALTS
This morning the Japanese Stock Exchange is about to score the fourth consecutive session of declines: the Nikkei index loses 0,4%. In contrast Nintendo, which gained more than half a point after the new console presented by the company on March 3 sold 330.637 units in the first three days. China's equity indices float around parity: Hong Kong +0,2%, Shanghai -0,2%. Mumbai -0,4%.
Historic turning point for Chinese trade. For the first time in three years, Beijing's trade balance closed in the red: -60,4 billion yuan against a forecast of a surplus of 120 billion. In January, imports grew by 44% (against the 25% expected), exports by only 4,2%. It is the effect of the increase in raw materials (primarily copper, iron and oil) but also, in part, of the seasonal variations associated with the long Chinese New Year.
The exception concerns the United States: US exports to China fell by 13,4%, Washington's deficit rose to 31,3 billion dollars (+12,5), a singular result of Trump's combative intentions. “We will have a lot to do in recent months” was the comment of Wilbur Ross, the billionaire called to lead American trade policy. The US deficit was the worst in the last five years.
WALL STREET PUNISHES SNAP. TRUMP PUNISHES PHARMA
Weak Wall Street, awaiting decisions on the cost of money. All indices are down: Dow Jones -0,14%, S&P 500 -0,29%. The Nasdaq was also down (-0,29%).
The managers' revolt against Snap continues, the company that abolished the right to vote for minority shareholders. The stock closed yesterday with a new decline (-9,8%) which adds to the -12,3% recorded on the previous day. The title, placed on Friday at 24 dollars, traded at 21,44.
The umpteenth tweet from President Trump also weighs on the market: “I'm working on a new system in which there will be competition in the pharmaceutical sector. Prices for the American people are going to come down a lot." The intent was probably to sweeten the pill, given the resistance to his health care reform project presented to Congress on Monday, also opposed by conservatives. The immediate effect was the unanimous descent of the pharma (-0,55%) and biotech sectors. Pfizer dropped 1,05%.
The prospect of a rate hike pushes the dollar up against the euro (+0,15%) but above all against the Swiss franc (+0,20%) and sterling (+0,35%). Oil prices are down: Brent at 55, 63, West Texas at 52,60. The prospect of an increase in the dollar and US inventories weighs on the sector. “The market travels within precise tracks – the manager Jonathan Barratt comments to Reuters – When the price approaches 50 dollars, Opec cuts production. When you travel towards 55 dollars, the production of shale oil increases”.
At Piazza Affari Eni -0,2%, Saipem -0,7%. On Wall Street, the worst blue chip is Chevron (-1,2%).
FLAT MILAN. OECD: ITALY LIGHTNING UP
The House of Lords has inflicted a new defeat to Theresa May by voting on an amendment which stipulates that the British Parliament must approve any exit deal before debate begins in the European Parliament or, if negotiations fail, must vote to approve Brexit without a deal. In this way, complained the prime minister, London's negotiating position is weakened.
Flat closing for Piazza Affari: the main Ftse Mib index gained 0,03% to 19.455 points. The other EU indices also fell, with the exception of the Dax30 which recovered 0,09%: the Cac40 lost -0,4% and the Ftse100 0,15%.
The Italian economy will grow both this year and next at a rate of 1%, only a tenth of the 0,9% with which 2016 ended. This can be deduced from the OECD's Interim Outlook, which shows that a weaker performance than the Italian one should be recorded only in Brazil - an absolutely stagnant economy - while for 2018 the estimate for Rome is the worst together with that for London, called to settle the Brexit bill. The OECD expectation at the aggregate level of the euro area for the two-year period is 1,6%.
The Btp/Bund spread closed the session with an enlargement at 186,328 basis points compared to 180,79 at yesterday's close, while the Oat/Bund differential stood at 64 basis points. Closing just below the intraday highs also for the rate on the ten-year BTP, which rose up to 2,20%. With regard to the 2-year maturity instead, the rate returned negative for the first time since 9 February.
PLACED THE NEW BTPEI. 6,5 BILLION BTP A YEAR AT AUCTION
The Italian Treasury has placed 3 billion euros of a new 10-year Btpei indexed to eurozone inflation, maturing in May 2028, collecting orders just under 6,4 billion euros. The new bond offers a yield premium of 11 basis points over the September 2026 Btpei rate, revised downwards by a guidance of 11-12 basis points, in turn reduced from the initial level of 13 basis points.
The Ministry of the Economy has announced that it will make 6,5 billion euros available in 12-month Treasury bonds in the auction on Friday 10 March, against a maturing amount of 6,6 billion euros. Monday's offer of medium/long-term securities will be announced today with the markets closed, with the probable launch of the new seven-year benchmark. The France/Germany spread recovered at the end of the session by 3 basis points to 66, however remaining far from the peak of around 80 basis points recorded last month.
MARCHIONNE: VOLKSWAGEN WILL SEEK ME SOON
Fiat Chrysler closed the day with a modest +0,1%, but Sergio Marchionne, speaking at the Geneva Motor Show, was still the protagonist of the day. With regard to alliances, the CEO opens up to a sensational hypothesis: "At the right moment Volkswagen will come knocking on our door" also because "the PSA-Opel operation threatens them more than anyone else".
Meanwhile Marchionne promotes the purchase of Opel by PSA indulging in a poisonous comment: "Now we will understand if Opel's problems depended on GM". But “my idea about the merger with GM remains the same, even if now the synergies have changed a bit and therefore it's less desirable. We have lost 20% of the synergies that could have existed with the merger. However it doesn't change anything. If geopolitical concerns are real to them, they are real to us too.”
For its part, GM reiterated that it is not interested in a merger with FCA. “We weren't interested before and we're even less interested now,” American group president Dan Ammann said, speaking to reporters at the show. “I could be cheeky and knock on GM's door again, but only if I think it's good for the business,” concluded Marchionne. In the meantime, FCA is planning the move of the Panda from Pomigliano to Poland: the Campania plant will be reserved for the production of Alfa and/or Maserati.
The market rewarded the confirmation that the CEO will remain at Ferrari (+1,06%) until 2022. Berenberg raised the target price of the share from 65 to 75 euros, confirming the buy recommendation. Exor +1,22%. Pininfarina's flight continues in the automotive sector, +20% on the wave of the agreement on the electric car with the Chinese Hybrid Kinetics.
THE PATENT BOX PUSHES PRYSMIAN. REFLECTORS ON STM
In industry, Prysmian stands out, +1,11% to 23,6 euros. Mediobanca Securities confirmed the outperform recommendation on the stock and the target price of 26,8 euros after the company signed the agreement on the Patent Box for the enhancement of the patent portfolio, which represents an important asset for the group.
Still ferment on Stm (+0,9%) which today could benefit from the accounts of Texas Instruments (+2,7%) at the new historical high on Wall Street,
Down by 2,2% Leonardo. The stock is weighed down by press rumors according to which the government has no intention of confirming CEO Mauro Moretti after the recent seven-year sentence in the first instance for the Viareggio train disaster. Equita underlines how the news, if confirmed, would be negative "given the good track record acquired by Moretti". Through the US subsidiary Leonardo Drs, the group has signed the definitive agreement for the purchase of Daylight Solutions, a company active in the development of quantum cascade technology laser products with an investment of 150 million dollars.
Fincantieri also loses (-4,3%) after rumors that speak of an agreement now concluded for the purchase of STX France, which however provides as a condition that Fincantieri has a maximum of 49% and is supported by 10% by another Italian shareholder .
GOLDMAN SACHS PUNISHES UBI AND BPER
Among the banks, for once, Italy (sector index +0,3%) does better than its European competitors (Stoxx -0,2%). Unicredit (+0,66%) and Banco Bpm (+0,67%) advance. After the sale of the All Funds stake (capital gain of 800 million), Intesa also rose (+0,26%).
The downgrade of Bper by Goldman Sachs (from neutral to buy) translated into a drop of 4,2%. The American broker also penalized Ubi Banca (-2,33%): target price at 3,4 from 3,6 euros, neutral recommendation confirmed.
THE GAME OF THE TOWERS STARTS AGAIN. MEDIASET BETS ON FOOTBALL
Ei Towers rises more than 5% on the wave of interest from Rai Way (again over +5%) for a takeover bid or takeover bid on the Mediaset subsidiary.
Slight increase for Telecom Italia: +0,45% to 0,7795 euros. Equita Sim confirmed the buy recommendation and the target price at 1,27 euros, emphasizing that the company could present an offer for the Serie A football rights until 2021. Mediobanca Securities remains positive on the stock (outperform, Tp 1,34 euro) and “sees a lot of value at current stock market prices. We like the restructuring story and see room for corporate actions that could further add value. We are not worried about the arrival of Iliad”.
